KUALA LUMPUR - Malaysia and Singapore have reportedly struck an accord on the deferment of the Singapore-Kuala Lumpur High Speed Rail (HSR) project, with the agreement expected to be formally announced this week.

The compromise, reached "in a spirit of good neighbourliness", will see Malaysia being spared having to pay a RM500 million (S$166 million) penalty for postponing the project, reported The Edge in its Sept 3 issue, citing sources.

According to the business publication, the 350km line will be deferred for two years, until May 31, 2020.

"We should be able to announce our joint decisions on RTS and HSR soon," added Mr Khaw, who is also Coordinating Minister for Infrastructure, referring to the Johor Baru-Singapore Rapid Transit System.

The source told The Edge that Singapore recognised the strain the project's construction could have on Malaysia's financial health.

Mr Khaw revealed in Parliament in July that Singapore had already spent more than $250 million on the HSR project, and is likely to expend another $40 million by the end of the year.

According to The Edge, the original deal to build the HSR, which was signed in 2016, did not contain provisions for a postponement.

Malaysia would have faced up to RM500 million in penalties, had it decided to terminate the project in breach of the agreement, said the report.

The rail line was expected to cut travel time between Singapore and KL from the current four hours by car to 90 minutes. The line was to have eight stations: the Jurong East station in Singapore, and on the Malaysian side - Bandar Malaysia, Sepang-Putrajaya, Seremban, Melaka, Muar, Batu Pahat and Iskandar Puteri stations.

The Straits Times

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